Despite its successful business model, the pallet exchange networks spawned back in the early 1990s face threats and like any other business they must resolve those threats or risk going under. One area where they are, perhaps, lacking is the need to invest in attracting human talent through more apprenticeships and other training schemes. Recent news that businesses in general are now putting their hands in their pockets more because the school leavers are not equipped for the skills that industry needs is to be welcomed but how can the pallet networks do that effectively if one of their biggest headaches, unsustainable low rates, continues to plague the industry? Without rate rises of at least 10-15% not only will more of the networks be at risk but the external and, perhaps, bigger problem of dwindling driver recruitment, now at an all-time low, exacerbated by the Government’s driver certificate of professional competence (CPC), can only get worse.
The Government’s attitude towards the haulage industry in general has not been helpful. While the heat is off over high fuel prices, for now, the Government has made little or no progress in terms of creating a fair playing field. Kevin Buchanan, former MD of Palletline and now MD at Pall-Ex, remarked: “The pallet network industry has never been recognised for the contribution that it has made and continues to make to the economy. We are over-taxed and receive a lack of appropriate legislation from the Government; investment in the sector is non-existent, apart from the entrepreneur hauliers who have to bear the ongoing increase in costs.” He went on to say: “The pressure brought to bear as a result of the Fair Fuel campaign has only been successful as it is because of ‘voter power’. Let’s be clear, if we are without the backing of associations like the RAC the road transport industry would not have had the same impact on the Government, who are only concerned about the attitude of the general public and do not understand or appreciate how important the sector is.”
Despite their many handicaps, the networks are, however, investing in the businesses to attract new talent, along with the other investments needed to improve their customer services. Fortec Distribution Network, for example, offer apprenticeships and internships with the aim of maintaining the necessary skills sets to ensure the long-term future of the company. Even so, the industry as a whole needs to do better here.
On the technology side, investments continue to enhance the customer offering, like that from Palletways who recently went live with its digital information hub. Via a dashboard, this offers a feature rich visibility of the status and progress of all consignments in the system in real time. Advanced mapped routing is also being extensively used. The instant messaging feature has already virtually eliminated the use of faxes and sharply cut the number of phone calls. The customer dashboard enables them to view their status in real time. Richard Miller, IT manager for Palletways (UK) said: “Our digital information hub is a massive leap forward in information visibility and our members and customers are starting to see the benefits. Our aim was to provide a system which would push relevant information to all parties’ screens, thereby removing the need for consignment queries by phone and email and so improve efficiency and customer service…”
All of the investments, however, will be put at risk if the means and will are not in place to reverse the alarming decline in driver numbers. A key part in the solution to that problem is a rise in pallet members’ rates, partly because the cost of training new talent is not cheap.